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Trip to create more business

THE Indonesian Government wants potential Hong Kong investors to take part in a study mission to Jakarta next month.

The visit will coincide with the Resource Indonesia '94 merchandise and commodity fair that will be held at the Jakarta Fair Grounds.

''First timers are welcome to join the study mission,'' said Fadillah Nurwawi, consul for economic affairs of the Indonesian Consulate.

''Any potential investor, buyer or exporter can join. We want to create business opportunities for them.'' The Indonesian Consulate in Hong Kong organises about six visits a year for potential investors.

''Usually, we accompany about 25 business people in a group,'' Mr Fadillah said.

''For people joining the mission, we set up meetings with officials of the Ministry of Industry, Ministry of Trade and Chamber of Commerce.'' The group will also be taken to the Resource Indonesia '94 where manufacturers will brief the Hong Kong mission about products and services at their pavilions in the exhibition hall.

''We will arrange visas. It will be especially helpful for certificate of identity (CI) holders. We will arrange the formalities fast, otherwise a CI holder will have to wait about a month for approval,'' Mr Fadillah said.

''For those who do not speak English, we can arrange interpreters, to make things easy for them in Jakarta.'' So far, there had been several enquiries about merchandise available at the trade expo, he said.

Those on the trip have to pay for their travel and accommodation.

Mr Fadillah said most Hong Kong investors were active in the manufacturing sector.

''They have invested in textiles, property, paper and paper products, hotels and restaurants, forestry products, wood and wood products, the food industry and basic metals,'' Mr Fadillah said.

He said most ventures by Hong Kong businessmen were concentrated in Java, one of the biggest islands in the Indonesian archipelago.

''There are more than 250 projects in Java,'' Mr Fadillah said.

''There are about 25 projects in Sumatra, about 26 in Kalimantan, two in Sulawesi and 10 in other areas.'' Hong Kong investors have committed US$3.9 billion to Indonesia's chemical industry.

Recently, another Hong Kong-based firm, Wisertech Ltd, committed US$3.5 billion to a refinery project, Mr Fadillah said.

In June, Hopewell Hong Kong was granted approval for a US$1.770 billion power generation project in central Java.

Since 1967, Hong Kong's investments in Indonesia had totalled US$13.35 billion, Mr Fadillah said.

''Over the years, investments from Hong Kong have gone into 345 projects,'' he said.

The rising value of investments has seen Hong Kong emerge as the second biggest investor in Indonesia, surpassing Taiwan which has invested US$8.74 billion.

The Japanese continue to be the largest investors in Indonesia. Investments from Japan since 1967 total US$17.67 billion.

Mr Fadillah said businesses could explore further opportunities in industrial zones.

The Batam Industrial Park, for example, on the island of Batam, offered tax benefits and full foreign ownership.

This 500-hectare industrial park is located about an hour by air from Jakarta and is 20 kilometres from Singapore.

It has also become a popular tourist destination.

''Indonesia has three types of industrial zones - export processing, bonded, and industrial estates,'' Mr Fadillah said.

''There are more than 100 industrial estates in Indonesia. Each has its own specifications and incentives.'' According to the Investment Co-ordinating Board (BKPM), there are seven bonded zones which have free trade ports.

After a recent deregulation package, more sectors, including shipping and power generation, have been opened for foreign direct investment.

While companies from Hong Kong explore manufacturing opportunities in Indonesia, bilateral trade between the two partners is on an upward trend.

Hong Kong is among Indonesia's top 10 markets for exports.

Last year's trade was worth $13.7 billion, with imports from Indonesia totalling $7.1 billion.

Wood products, textiles, coal, paper and pulp are among the biggest imports from Indonesia.

Ibnu Hadi, vice-consul for economic affairs at the Indonesian Consulate, said: ''Between 60 and 70 per cent of Indonesia's exports to Hong Kong are re-exported to China. So, the trade balance does not reflect the real situation.'' Hong Kong exports to Indonesia were worth $6.5 billion. Textiles, telecommunications equipment, toys and games and leather machinery were among the territory's biggest exports last year.

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